Snowflake (NYSE:SNOW) kicked off the fiscal year with a strong performance, as its first-quarter revenue surpassed analyst expectations, leading to a 4% rise in its stock price in pre-market trading today.
The company reported quarterly revenue of $828.7 million, a 33% increase from the same period last year, and well above the Street estimate of $786.82 million.
Although the adjusted earnings per share (EPS) of $0.14 missed the analyst estimate of $0.18, investors were encouraged by the robust revenue growth, driven by a 34% year-over-year increase in product revenue, which reached nearly $790 million.
For the second quarter, Snowflake forecasts product revenue between $805 million and $810 million, exceeding the analysts’ consensus of $785 million.
The company also revised its product revenue forecast for 2025 upward to $3.30 billion from the previous estimate of $3.25 billion. Snowflake reported a net revenue retention rate of 128%, indicating strong customer satisfaction and expanded usage. The customer base saw significant growth, with 485 customers now generating over $1 million in trailing 12-month product revenue, a 30% year-over-year increase.
Remaining performance obligations rose to $5.0 billion, a 46% year-over-year increase, suggesting strong future revenue potential. CEO Sridhar Ramaswamy credited the strong quarterly performance to the core business’s strength and the growing interest in its AI products.